Life Insurance Industry – part 1

I have seen this industry since its inception in the private sector. Should I say second birth? Perhaps yes. So here is some nostalgia…..Who are the stakeholders and what are their views:

Employees: The employees should be divided into two classes – those who joined in 2001 and those who joined in 2008 and later. The ones who joined in 2001 now boast of a long track record and a good track record of changing 2-3 companies if not more. Most of them came from pharmaceutical, banking, mutual funds and life insurance (read LIC), etc. and got monies perhaps beyond their expectations. In the early years it was easy to sell life insurance and they also got huge bonuses which they either spent or invested in S I P of mutual funds. Many of these people are sitting on a nice net-worth (perhaps) beyond their parent’s imagination.

However the employees who joined the industry after 2007-8 are finding life very, very difficult to do honest sales and are struggling to live on a day to day basis. This is because like David Copperfield they are finding that the roads are not paved with gold and their bosses are quoting from easier times. Also the employees who are selling through a salaried sales force (read Banks) are doing very well because the banks are STILL able to get products with high commissions as a % age of  the first year premium. However the employees handling the IFA (agents) are unable to earn any commission – and are looking at alternatives.

Non Sales employees are sitting on good salaries, nice vacations, ‘off-site’ workshops, HR interventions, but and not much business. This is a great combination – but scary.

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